Lagos 2015 (Exploratory)

Common Questions

How does the application process work? After submitting an application and paying the $50 USD Application Fee, candidates will be sent an Admissions Test. Candidates will have three days to finish the Admissions Test, which takes just over an hour to complete, and then they will either be Accepted or put on a "Finalist" List. Accepted Founders are then invited to pay the $500 USD Course Fee and upload the signed Founder Agreement in order to enroll. In addition, the Course Fee is FULLY REFUNDABLE during the first week of program sessions, so that our participants can make an informed decision about the program.

What is the time commitment required by a Founder? The Institute requires a minimum of 20 hours of work per week, on average. Participating Founders are required to attend each three and a half hour weekly session. The sessions will have between five and ten hours of assignment work that needs to be completed before the following session. If a participating Founder is also working on a prototype or some other aspect of the business, then the time commitment can be much greater.

How does a Founder graduate from the program? In order to graduate, there are four criteria. First, a Founder must attend all sessions. Second, a Founder must complete all of the Assignments in coordination with the Working Group. Third, the Founder must incorporate a suitable company. Fourth, once the Founder is invited to graduate, the incorporated business must issue a Warrant, and the Founder will join the Shared Liquidity Pool. The Institute supports the efforts of every entrepreneur. The goal is for 100% of the participants to succeed, but it is inevitable that some in the program are unable to graduate.

Do I need to attend every session? Attendance is mandatory. However, it is understood that Founders may have emergency business travel or illness that prevents them from attending one session in a semester. The Institute makes exceptions on a case by case basis, but absences are highly frowned upon. In addition, all sessions are professionally recorded and available online for future use.

Should multiple co-Founders apply? The Institute encourages all co-Founders to apply. Each co-Founder is required to take the Admissions Test. All accepted co-Founders are expected to enroll and remain in the program together.

Are there other costs to being in the Institute? You will need to incorporate a company during the semester, which will cost money, and you may have other business expenses. The Institute works to reduce the cost of launching a new business by as much as tenfold in the first year.

Will information from the application process be shared or made public? The Institute will not reveal application information to the public. The results of the Admission Test and application processing are not shared with the applicant.

Ideas

Does the Institute focus on any particular business field? The Institute only supports technology businesses. The definition of technology spans online, software, health information systems, clean technology, hardware and consumer electronics. The Institute selects a wide range of Mentors to be sure that all relevant technology sectors are sufficiently covered.

Will participating Founders need to disclose their ideas? No. If a Founder is uncomfortable sharing an idea, then the Founder is not required to disclose anything. All Mentors, Founders, and participating staff are bound by confidentiality provisions.

Do applicants have similar ideas to one another? Yes. The Institute does not ask applicants to submit their specific business idea in the application process, since our focus is on developing you as a Founder. In past Semesters, Founders have shared ideas and collaborated accordingly.

Can Founders submit more than one idea? This is up to you. The Institute is more interested in the person, and less interested in the business idea. Founders must select one idea to turn into a company within the first 60 to 90 days of the program.

Mentors

What is the range of Mentor experience? The Institute selects Mentors with a broad range of industry experiences, including hardware, software, manufacturing, biotech, entertainment, digital media, investment, services, and B2B/B2C. Most Mentors have started multiple companies and are currently running a well-known startup. The Mentors were chosen for their ability to speak on a specific set of important business issues that affect all high-tech startups.

How do Founders get paired with Mentors? The pairing process is informal. Founders have the opportunity to ask questions of Mentors before, during, and after each session both online and in-person. While some Mentors are extremely busy, it is expected that the majority of Mentors will help Founders where they have common interests. The Mentors are compensated through a shared upside pool, and Mentor compensation increases with positive reviews from participating Founders. This gives Mentors the extra incentive to help the Founders, provide introductions, etc. In addition, a final review is done after the program is completed, creating an incentive for longer term Mentor involvement.

If I drop out of the program or get dropped after the refund deadline, can I return to the next semester for free? Can I join a different location?
If you cannot finish the program for a personal reason or get dropped by the Founder Institute, you can join the next semester in the same location for free. If you want to join a future semester, in either your location or a different location, you will need to pay a small re-enrollment fee ($50), plus any difference in course fee. We will not refund any fees if the course fee for a future semester is lower.

Applications

Is it better to apply sooner rather than later to the Institute? Yes. All applications are processed in the sequential order that they are received. If you apply before the early admission deadline, you will have two separate chances to be admitted into the program. Space is limited, so apply early.

Can I apply if I have an established startup? Yes. The Institute will accept any founder that is running a business less than two years old with less than half a million in annual revenues, as a general rule of thumb. The first semester of the Founder Institute included Founders with a wide range of experiences. 20% of the 54 companies that graduated from the inaugural semester were already incorporated at the beginning of the program. Some of the Founders had nearly complete products with sizable partners.

How many Founders will be in the program? The Institute accepts between 25 and 50 Founders. A number of factors encourage limiting the group size, such as the capacity of reserved meeting facilities, the ability to deliver a meaningful mentorship experience, and the quality of the shared upside among participants.

I applied, but did not receive an email response. Did you get my application? Yes. After you successfully apply, you will be logged into the Founder Institute site. On the right hand side, it should say: "Semester: [Semester], Role: Founder, Status: Applied." This indicates that your application has gone through. As the Institute processes applications, your status will change to "Reviewing," "Accepted," "Finalist" or "Rejected." The Institute will email you with your application status once it changes.

Fees

What does the $50 USD Application Fee cover? The $50 USD Application Fee covers the cost of processing the Admissions Test, which is handled by a third party testing provider. The fee is non-refundable.

What does the $500 USD Course Fee cover? The Course Fee covers the cost of operating the sessions, including Mentor travel stipends, location fees, audio visual, etc. The fee is FULLY REFUNDABLE during the first week of the program sessions, so that participants can see if the program is right for them.

What are the optional fees? If an enrolled Founder graduates or continues to the last 45 days of the program, the enrolled Founder is asked to contribute two additional fees. First, the Founder is asked to grant a Warrant for 3.5% of their company stock to join a Shared Liquidity Pool with their peers. Second, the enrolled Founder is asked to pay a Tuition Fee of $4,500 for any financing by a third party for more than $50,000.

Why Warrants versus equity?Warrants have a number of advantages over equity. (1) Successful Founders from incubators often feel that they receive bad investment terms from the incubator. Warrants ensure that any equity placed in the Bonus Pool for the Institute and other stakeholders is priced by the market, creating a win-win scenario. (2) Warrants do not give the Institute any control or voting rights in the company

Program

Do Founders need to quit their day job? No. The Institute has a mix of full-time and part-time Founders in the program. Many businesses get started with part-time Founders until the company gains traction. Once a company gets off the ground and properly capitalized through revenues or investment, the Institute expects that the Founders will start working full-time.

Can participating Founders find co-Founders in the program? Yes. Since participants have shared areas of interest and hail from a variety of backgrounds, it is common for founding teams to be established with different program participants. In one case a Mentor even joined one of the Institute companies as a Co-Founder.

Why do some people not make it to Graduation? Graduating from the Founder Institute is challenging. First, only roughly 30% of applicants are accepted to the program. Then, less than 40% of accepted Founders generally make it through the program to Graduation. In order to graduate, a Founder needs to develop an engaging idea for a technology company that is validated by the program mentors, plan out the business, work on an offering, incorporate their company, and complete all of the required assignments - all within a four month timeframe. Reasons for not graduating differ, but each Founder who leaves is invited to join a future semester, when they are ready to launch a business. You can even read a review of a recent FI Dropout here.

How will you get involved in the idea creation phase with the entrepreneurs? In the beginning of the program, the Founders are broken into smaller working groups by related ideas, and provided with very specific assignments for refining, researching, and validating ideas.

From having a great idea to taking it to the market successfully, what do you think is the most difficult part of the process for an entrepreneur? The hardest challenge for a founder is understanding and completing all of the various things that need to get done to launch a company in a logical and orderly manner. Finishing a prototype and product is just one of many important steps, and Founders often overlook critical details which come back to haunt them later.

What are the key steps to succeed in the Founder Institute program? The process of building your company will be a lot harder than you ever expected. Maintaining your enthusiasm, passion, and enjoyment of pursuing your vision is paramount.

Investment

Can I apply if I am not planning to raise money? Yes. The Institute encourages Founders with standalone business ideas that are capital efficient to apply. The majority of topics covered in the curriculum are relevant to any business, such as team building, vendors, and revenue. The Institute is working with two dozen partners on discounted or free offerings to dramatically reduce the cost of launching a new company, making enrollment worthwhile.

Can I apply if I am already fundraising? Yes. The Institute encourages active fundraising throughout the Semester for Founders that are prepared and require outside capital. The goal is to get Founders in front of investors multiple times before the Semester ends.

How will Founders interact with investors? At graduation, top rated angel investors and venture capitalists will be invited to attend and contribute. At this investor session, you will be experienced and very well prepared to pitch. In past investor sessions, over a dozen venture capital companies have been represented, with additional angel investors. The Institute also facilitates investor meetings outside of the program.

Are investors turned off by the Class F stock and Bonus Pool? Some are, yes, and others are not. Only the best teams and the best companies will receive financing in the current economic climate, and these strong opportunities will be able to push for better terms. The Institute aims to foster the best, and that is reflected in the terms. The Institute does not mandate that companies use the documents nor that the Founders participate in the Bonus Pool.

How much money should participating Founders plan on raising? The Institute invites a wide range of Founders from different sectors to apply. Some companies need more capital and will raise more capital during the program. The amount of money that a participating Founder can expect to raise is ultimately based on the business, its specific needs, and the execution.

Does the Institute make investments? The Institute manages a small percentage (3.5%) of Warrants in a company that is formed by a Founder during the program. Warrants provide the Institute with an option to buy stock at a fair market price, and this price is set during the first qualified financing round that the company raises. The Institute distributes the majority of the value generated from the Warrants back to program, Founders and Mentors. The remaining portion of the Warrants can be used by the Institute to participate in financings at fair market market value.

Does the entrepreneur have input into and veto power over the valuation? The Founders choose the investors, negotiate the terms, and sign the deal with assistance of, but no control from, the Founder Institute. Everything is up to the founder and the shareholders. Keep in mind that the Founder Institute will not be a shareholder of any kind pre-funding.

Who is funding the institute? The Institute is funded by Adeo Ressi, a serial entrepreneur and Founding Member of TheFunded, Incorporated. The idea for the Institute began in January, 2009, as a way to help Founders avoid common mistakes that lead to the failure of a business. In February, Topicki was launched as an interactive curriculum builder for the sessions, and hundreds of CEOs contributed ideas on what Founders need to know. On March 3rd, the story was leaked to TechCrunch, forcing the Institute to move quickly on plans. The company was incorporated on April 17th, 2009, using the same documents offered to the public and to the participating Founders one day before accepting applications.

What is the Institute involvement with TheFunded.com? The Institute is a separate company from TheFunded, Incorporated. The Institute leverages a close working relationship with TheFunded.com to help recruit world-class mentors and identify the optimal investors.

The Founder Institute is the world's largest entrepreneur training and startup launch program, helping aspiring founders across the globe build enduring technology companies. Based in Silicon Valley and with chapters across 50 countries, the Founder Institute has helped launch over 1,550 companies in 6 years. The company's mission is to "Globalize Silicon Valley" and build sustainable startup ecosystems that will create one million new jobs worldwide.